A cynical commentary about developments in the South African financial markets and the incomprehensible activities and pronouncements of bureaucrats and politicians.

Friday, 29 June 2018

HALF WAY IN 2018

Much to the
dismay of many people who have become used to politicians who say one thing and
then do nothing, President Trump pretty much does what he says he will do. And
what’s even more infuriating for those who believe they can direct and
influence public opinion, he utterly ignores their advice. It will take several
decades of history before there will be sufficient objectivity and
non-partisanship to allow for a clear-eyed summary of whether this man is doing
a good or bad job. In the short-term meantime, markets are not thrilled with
the man’s latest interference in the sovereign right of Americans to make a
quick buck. The bull is certainly not as evident as he has been.

However, back
home we have been treated to a textbook illustration of the Margaret Thatcher
thesis that the problem with socialism is that governments eventually run out
of other people’s money. The much-revered minister Pravin Gordhan, who
nevertheless is at heart a socialist, has admitted that he has run out of dosh
and ideas with which to fix all the state-owned enterprises. So he called in
the private bank bosses and asked for their advice (and of course money).
Simultaneously other state luminaries have noted that President Cyril’s
overseas mission to drum up USD100bn for investment is SA might perhaps need a
bit of local seed money to get moving and a figure of a tenth of the target is
being wafted about for local private enterprise to drop into the slotted tin.
The difficulty for all potential “investors” is the evidence suggests that the
return is not only zero but the capital as well is likely to disappear into the
voracious maw of cadre life-style maintenance programs.

It wasn’t
very long ago that most of us had never heard of VBS Bank. Then Jacob Zuma found
out about it and managed to secure a loan from them to complete the upgrade of
his humble abode in Nkandla. Now we are discovering why it was so easy. VBS was
an institution that was busy putting the “Cor” into corruption!

The highly
emotive issue of land is raising a number of very interesting issues, not least
of which are tribal ones. Zulu King Zwelitini is asking all Zulus to chip in
R15 a head to help fund law suits and protests to protect from the government what
he sees as land belonging to the tribe. This donation suggestion has been
trebled from the original fiver because the king has noted the iniquitous level
of bank charges for cash deposits. And does this mean that the next census will
also pry into each South African’s tribe affiliation?

Apparently,
the board of the South African Bureau of Standards has failed its own standards
test and minister Red Rob Davies has fired the lot of them. At first (naïve) glance
this would seem to be an agency that could be devoid of politics, corruption
and sleaze, until one is reminded that they did some work for the Guptas!
Something to do with coal quality. So that’s a full house for the ruling party
then? Is there a single area within the state’s control where they have improved
its operation or capability? What a dire and damning record.

Even the tax
collection business is broken. Apparently once a jewel in the crown in respect
of its efficiency and probity (really?) SARS was seemingly hollowed out by
Jacob Zuma and his cronies seeking to ensure nothing impeded the flow of large
sums of money in unusual directions. The impunity and fearlessness with which
the laws of the land were bent and ignored is breath-taking.And deeply saddening.

It is rather
embarrassing to admit that I have come to enjoy the massive doses of soccer on
the TV from the World Cup. Mostly it’s pretty baffling to a rugby man used to
robust encounters and yellow cards that have immediate impact but there is one
aspect of that game where rugby could learn. They need urgently to borrow a
copy of the FIFA “Guide to Kit and Colour Selection” and so avoid the very
confusing incidents where both the teams plus the officials on the pitch are
dressed nearly alike. They can however safely ignore the section about what
looks like support hose pulled well up into the leg of the shorts. Very unflattering.